How is UK startup Seon helping fintech companies comply with sanctions against russia?

London-based startup Seon is helping fintech companies such as Revolut fight online fraud. It has raised $94m in investment in a new funding round. The company plans to use the money to develop new tools to combat Russian sanctions evasion in the context of the war in Ukraine.

The startup’s story began with the friendship of two students, Kadar and Jendrushak. They had a common interest in cryptocurrency and decided to create their own virtual asset exchange. Then the friends faced the problem of constant attacks by fraudsters. They found a solution to the problem by founding a startup whose main goal was to help online businesses to counteract fraud. Seon began its journey in 2017 in Budapest. Seon competes with a number of start-ups, including Israeli company Riskified and US-based Arkose Labs. Its software analyses a consumer’s email address, phone number, and other details to create a “digital footprint” and uses the software to determine whether they are genuine or suspicious.

The actions of Russia’s sub-sanctioned citizens have only exacerbated a pre-existing problem of illegal activity using fintech companies. This time, the startup has attracted additional investment from Silicon Valley to address the potential use of fintech applications for money laundering and sanctions evasion. The service’s tools can identify shell companies for illicit profits or identify fake identities to hide their assets.

Another compelling reason for this investment is the government’s pressure on fintech companies to fight the evasion of russian sanctions. Concerns include the fact that their supervision may be weaker than that of banks. Therefore, Seon plans to create a feature that will allow companies to check online and find out if their shareholders are on any sanctions lists.

For Ukraine, the fact that the startup is quite promising is important, and so it will continue to fight the illegal actions of the Russians in the financial markets. The company is now valued at $500 million, its annual revenue in 2021 has tripled, and its customer base has grown more than twice as much.

In summary, russia’s war with Ukraine has prompted fintech companies to look for new ways to combat illegal financial activity, such as money laundering and sanctions evasion. And the projects of British startup Seon confirm the need for technical solutions to combat fraud.